Japan stocks rally again, as China shares drop

SarahTurner

V.Phani Kumar

HONG KONG (MarketWatch) — Japanese stocks ended at a seven-month high Monday, further stretching a recent rally that has been inspired by a weakened yen, while Chinese and South Korean shares slipped on caution ahead of a Eurogroup meeting on financial aid for Greece.

The Nikkei Stock Average
NIK, -1.11%
which had already risen in six of the seven sessions prior to Friday’s holiday, rose 0.2% in Tokyo to end at 9,388.94, a closing level it hasn’t seen since late April.

Australia’s S&P/ASX 200 index
XJO, +0.12%
gained 0.3% and Taiwan’s Taiex
Y9999, -0.61%
added 1.1%, building on Friday’s 3.1% surge on the local government’s pledge to support the local market after a dismal performance in the year to date.

The mixed performance came as euro-zone finance ministers were set to reconvene, after failing to approve Greece’s latest tranche of aid last week. Ahead of the meeting, traders had “some doubts about the significance of the strong rally in U.S. markets on Friday,” given that it took place in holiday-thinned trading, said Ric Spooner, chief market analyst at CMC Markets.

“In these circumstances, many traders prefer a cautious stance, waiting to see if the market can hold these gains once [U.S.] trading returns to normal this week,” Spooner said.

Monday’s Japanese stock gains followed a 3.8% advance for the Nikkei Stock Average over the four trading days last week, as the yen weakened further. The dollar
USDJPY, -0.35%
posted strong gains against the yen last week, and is up nearly 3% so far in November, amid hopes for more monetary-policy easing.

Just ahead of the stock-market open on Monday, the Japanese central bank released the minutes of its Oct. 30 policy meeting — a meeting at which it decided to expand its asset-buying program — with the language underlining plans to “undertake further aggressive monetary easing.”

Shares of Renesas Electronics Corp.
6723, +3.73%RNECY, -0.19%
soared 16.6% after the Nikkei business daily reported the three top shareholders in the struggling microchip maker were set to buy the firm out.

In Australia, Qantas Airways Ltd.
QAN, +5.88%QUBSF, +0.00%
climbed 2.8% after the Australian Financial Review reported over the weekend that a group of former executives and investors had bought a stake in the firm.

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